Two groups named as bidders for Vivacom

Two bidders are in the running to buy Bulgarian operator Vivacom, according to Reuters, citing "two sources familiar with the process".

But the sale of the troubled company is likely to be hindered by disputes about ownership.

The agency listed the bidders as Bulgarian businessman Spas Roussev, who will be competing with an alliance of Olympia Group, controlled by Greek businessman Panos Germanos, working with Third Point, an investment vehicle of activist investor Daniel Loeb.

The sale by auction was launched by VTB Capital and is being run by accountancy firm EY’s London office, said the report.

Vivacom, formerly Bulgarian Telecommunications Company, has had a troubled history for at least five years. In 2010 company was owned by PineBridge Investments, a New York-based global asset management organization majority-owned by a subsidiary of Pacific Century Group, which is associated with Richard Li’s PCCW. Vivacom had about €1 billion in senior debt, owned by banks including RBS and Deutsche Bank.

Creditors appointed Morgan Stanley to find a buyer. Telekom Austria decided not to bid and Turkcell’s bid was rejected. In 2012 Vivacom’s creditors approved its sale to Bulgaria’s CCB and Russia’s VTB Bank.

Later that year the High Court in London approved a €1.7 billion debt restructuring under which CCB and VTB bought more than 70%. PineBridge, which today has $77.6 billion worth of assets under management, lost its 94% stake in the company.

The Reuters report says that there are likely to be disputes about the new sale Vivacom. Bulgaria’s Deposit Insurance Fund, will be wanting to recover funds that it invested in CCB. And a Russian businessman, Dmitry Kosarev, said in a statement through his company Empreno Ventures that he has acquired a 43% stake in Vivacom and plans to dispute the results of the sale of the company.

He acquired his stake from Tsvetan Vassilev, believed to be formerly the chairman of the supervisory board of CCB. Vassilev has been charged with embezzlement, says Reuters, and awaits the outcome of extradition hearings in Serbia.

Kosarev has turned to the Bulgarian prosecutor’s office with a request to prevent the sale of the company, reported Russian news agency Regnum.

Of the current bidders, Roussev is an art collector and is a supporter of the Serpentine Gallery in London.

Germanos owns a Greek electronics goods chain but is facing trial in Athens with 31 other defendants in connection with allegations of bribery and money laundering linked to the purchase of German submarines by the Greek navy. He has denied the charges, which date back to the 1990s.

Loeb’s Third Point owns 15% of the auction group Sotheby’s after a long battle with the company over governance.